Economist's Commentary: October 27, 2008
Quick Take on the Economy: October 27, 2008
By George Ratiu, Research Economist
New Home Sales
- New Home Sales (NHS) moved up 2.7 percent in September to 464,000 from August's revised number. On a year-over-year basis, sales were 33.1 percent lower.
- The current inventory level of 394,000 is down 25.4 percent from a year ago.
- The months' supply measure is at 10.4 months, an 8.8 percent drop from August.
- Regionally, for September 2008 compared with August 2008, NHS fell 21.4 percent in the Northeast, decreased 5.8 percent in the Midwest, increased 0.7 percent in the South and jumped 22.7 percent in the West.
What does today's data mean for REALTORS® and consumers?
- New home sales posted a surprising increase in September, driven by a surge of sales in the West. Homebuyers seem to be taking advantage of lower prices and improved affordability conditions. The rise in existing home sales has also been the strongest in the West. The trend suggests a chain-reaction effect of first-time buyers helping the trade-up buyers to now make their move, with some choosing to buy a newly built home.
- New home inventories continue to decline, a move in the right direction for the housing market.
Daily Forecast Update
- NAR's monthly official forecast as of October 8th (15K PDF)
- GDP Q3: -0.3%
- GDP Q4: -0.6%
- Unemployment rate at year end: 6.5%
- Average 30-year fixed mortgage rate in December: 6.1%
- Average 30-year fixed mortgage rate by mid-2009: 6.4%
- The next Fed policy change: a rate cut at the end of October.
This is one in a series of commentaries by the Research staff of the National Association of REALTORS®. Read more commentaries >
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